A look at the rapidly changing face of published Business Class fares to Europe

The airlines train us to think about fares in terms of the restrictions they impose. The most common one has been the advance-purchase requirement, and the rule of thumb has long been that the farther in advance you buy the ticket, the better the deal. Thus, until the advent of low-service carriers like AirTran and Jet Blue, the least-expensive fare was usually found with a 21-day advance purchase; 14-day fares were a little higher; and the price really ratcheted up with a 7-day advance purchase. A walk-up fare could be five times as high as a 21-day fare.

The second most common restriction was the Saturday-night stay. With it, a fare was low; without it, a fare was high. That pretty much separated the business traveler, whom the airlines were intent on fleecing, from the leisure traveler, whom they were intent on luring. And, from the US, you never saw anything but full, unrestricted fares for Business and First Class travel.

November 2001: Advent of the “Heavily Discounted” Business Class Fare Back in November 2001, Northwest began to retrain us in thinking about Business Class travel to Europe: It launched Business Class fares at $1,800-$2,200. (Usual cost then: $5,000 to $8,000 round-trip.) The restrictions: 50-day advance purchase and a Saturday night stay. At the time, the fare was only matched by a few carriers; today as many as 14 carriers offer such fares at any given time.

The 50-day advance purchase changed our thinking in two ways: It lessened the importance of miles because the fares were so reasonable, and it reduced dependency on 2-for-1 programs, usually only available with fares starting at $7,000+. Overnight, the face of Business Class to Europe changed radically.

2002: Seat Wars Next, some airlines started persuading us that a better, lie-flat Business Class seat was worth more—usually $800 to $1,000 more—than a so-so one. That was the thinking behind British Airways’ 2002 rollout of fares that were less than the carrier had been charging, but more than Northwest. Virgin matched BA.

February 2005: The 21-Day Advance Early in 2005, Northwest introduced $2,800-$3,300 fares with a 21-days advance-purchase requirement. (It’s been matched by several carriers, primarily on routes to London, Frankfurt, and Paris). Now the idea is that good fares can be obtained on shorter notice. These fares are still often less than most 2-for-1’s, a huge boon for last-minute vacationers, not to mention business travelers with somewhat firm schedules.

June 2005: The New 14-Day Advance In mid-2005, British Airways began testing a 14-day advance fare of around $3,800 to London and onward to Paris, Rome, and Geneva. While BA has since pulled the fare in most markets, other carriers have stayed with it, at least for travel to London. (Message to BA: don’t introduce a fare if you’re not prepared to stay the course). So now you can pick up a New York-London fare for $3,000+ only two weeks out—still a much better deal than a 2-for-1.

These fares are currently being offered by American, Continental, Delta, Northwest and many others. But the fares might disappear this fall, when business travel typically picks up.

Lowest Fares Increasing: Until recently, the $1,800-$2,200 fares have been remarkably stable since they were introduced in 2001. With increased demand, fares have been climbing $500 to $1200, depending on the route and airline. The lower fare levels have been successful. Let’s hope the airlines don’t price themselves out of this segment.

November 2005: The All-Business Class Carrier Effect Connecting two financial powerhouses, New York-London service historically had been one of the most expensive routes in the world. Then the all-Business Class carriers came to town offering heavily discounted fares. Some without restrictions—which changed the game, again. MAXjet will fly you round-trip with no advance purchase for $1,398.

British Airways and other high-fare carriers have had to adjust fare structures substantially. The effect on Business Class travel costs is immeasurable, most notably for travel between New York and London, while other routes largely remain artificially high. While loyalty programs offering “free” tickets continue to be US carriers’ value proposition, their inferior premium seats might not sustain them.

My Crystal Ball While full, business-travel fares continue to increase, the airlines are still going to discount perishable products to leisure travelers—since $2,000 of revenue beats an empty seat and zero dollars. Airlines with more available seats—often because they’re of inferior quality—will have to discount the heaviest. It’s unlikely that there will be much parity in premium pricing—not necessarily a bad thing.

In other words, airlines with an inconsistent Business Class product—perhaps because its seats vary in recline one aircraft to the next, even though it calls them the same heavily branded name (concealing the differences), or they are just plain flat out inferior—will have to discount. This will have an effect on carriers with better seats, because consumers are less aware of seat differences.

“Competition” gets real blurry here. There’s the fare, seat quality, and mileage program. Seldom does one carrier take home the triple crown. The differing, often unquantifiable variables, could lead to consumers winning the war for value in the foreseeable future.

The fare tables are turning.

How to Play Business Class Fares to Europe…

1. Go into the process without preconceived notions. Fares are changing rapidly.
2. Be prepared to use miles for awards tickets and upgrades, but also find out the best published fare. Why? With airlines such as Delta, the difference between the lowest mileage upgradeable fare and the lowest published fare might not be much, so you’d be better off saving your miles. Traveling on a published fare will also earn you more miles and credit towards elite status.
3. Whether using miles or cash, always check alternate US and European gateways. You could get a much better deal or a better schedule.
4. Don’t rely on Internet search engines alone. Call the airline directly (or even better, call a good travel agent). The first questions to ask are: What’s the lowest fare for this itinerary, and what do I have to do to get it? The reservationist or agent can help you navigate rules and restrictions and find alternative routes and fares faster than you can often get online. Make sure to ask whether the noted carrier is actually operating the flight, or whether it’s operated by a code-share partner. You don’t want to buy an Air France ticket thinking you’re getting one of its new seats, only to get to the gate and find a Delta aircraft there with a Business Class seat that only reclines 160 degrees.